Inside Experts: The top 10 2012 e-discovery trends

Abraham Lincoln once said, “The best thing about the future is that it comes only one day at a time.” While this is certainly true, it seems like the days are coming more quickly now than ever, particularly with the way technology is impacting the practice of law. Unlike the rash of recent doomsday predictions, many of the following are simply nascent trends that will hit an inflection point in 2012. Each will have a key impact on how the e-discovery landscape will continue to evolve.

1. Technology Assisted Review (TAR) gains speed. The area of Technology Assisted Review is very exciting because there are a host of existing and emerging technologies that can help make the review process more efficient, ranging from email threading, concept search, clustering, predictive coding and the like. There are two fundamental challenges however. First, the technology doesn’t work in a vacuum, meaning that workflows need to be properly designed and users need to make accurate decisions because those judgment calls are often then magnified by the software solution. Next, the defensibility of the given approach needs to be well-vetted. While it’s likely not necessary or practical to expect a judge to mandate the use of a specific technological approach, it is important for the applied technologies to be reasonable, transparent and auditable since the worst possible outcome would be to have a technology challenged and then find the producing party unable to adequately explain their methodology.In 2012, judges and practitioners alike will become increasingly comfortable with the role technology plays in the review process, particularly given the noted deficiencies and costs associated with the alternative – manual, eyes-on attorney review.

2. The custodian-based collection model comes under stress. Ever since the days of Zubulake, litigants have focused on “key players” as a proxy for finding relevant information during the e-discovery process. Early on, this model worked well particularly in an email-centric environment. However, as discovery from cloud sources, collaborative work sites like SharePoint and other unstructured data repositories become increasingly mainstream, the custodian-oriented collection model will become rapidly outmoded because it will fail to take into account topically-oriented searches. This trend will be further amplified by the bench’s increasing distrust of manual, custodian-based data collection practices and the presence of better automated search methods, which are particularly valuable for certain types of litigation (e.g., patent disputes, product liability cases).

3. The FRCP amendment debate will rage on – unfortunately without much near term progress. While it is clear that the e-discovery preservation duty has become a more complex and risk-laden process (particularly in light of the recent Pippins v. KPMG case), it’s not clear this “pain” is causally related to the FRCP. In the notes from the 2011 Dallas mini-conference, a pending Sedona survey was quoted, referencing the fact that preservation challenges were dramatically increasing. Yet, there currently isn’t a consensus viewpoint regarding which changes, if any, would help improve the murky preservation problem. In the near term this means that organizations with significant preservation pains will need to better use the rules on the books and deploy enabling technologies where possible.

4. Data hoarding increasingly comes under pressure. The cry of many IT professionals that “storage is cheap” is starting to fall on deaf ears. Organizations are realizing that the cost of storing information is just the tip of the iceberg when it comes to the litigation risk of having terabytes (and conceivably petabytes) of unstructured, uncategorized and unmanaged ESI. This tsunami of information will increasingly become an information liability for organizations that have been unsuccessful at effectively deleting ESI. In 2012, more corporations will see the need to clean out their digital houses and will realize that such cleansing, where permitted, is a best practice moving forward. While this is a non-trivial task, the alternative (i.e., never deleting anything) is clearly unsustainable, particularly because corporate data volumes are growing at roughly 50 percent each year.

5. Information governance becomes a reality. For several years there’s been an effort to combine the reactive (right) side of the EDRM with the logically connected and proactive (left) side of the EDRM. But now, a number of surveys have linked good information governance hygiene with better response times to e-discovery requests and governmental inquires, as well as a corresponding lower chance of being sanctioned and the ability to turn over less responsive information. In 2012, enterprises will realize that the litigation use case is just one way to leverage archival and e-discovery tools, further accelerating adoption. Bringing together archiving, e-discovery, data loss prevention and other security technologies, information governance as an umbrella concept will enable organizations to freely use cloud computing, social media and mobile devices to meet business objectives.

6. Backup tapes will be increasingly seen as a liability. Using backup tapes for disaster recovery and business continuity purposes remains a viable business strategy, although disk-based backup and snapshots are growing fast. However, if tapes are kept around longer than necessary, they become ticking time bombs when a litigation or inquiry event crops up. In 2012, backup tapes will be increasingly used for disaster recovery, whereas archiving technologies will be better suited for electronic discovery, compliance and information governance purposes.

7. International e-discovery and e-disclosure processes will continue to mature. It’s easy to think of the U.S. as dominating the e-discovery landscape. While this is gospel for us here in the States, international markets are developing quickly and in many ways are ahead of the U.S., particularly with regulatory compliance-driven use cases, like the U.K. Bribery Act. This fact, coupled with the menagerie of international privacy laws, means we’ll be less Balkanized in our e-discovery efforts moving forward. Given the number of multinational corporations, we will increasingly need to be thinking and practicing globally.

8. Email becomes “so 2009” as social media gains traction. While email has been the ediscovery darling for the past decade, it’s getting a little long in the tooth. In the next year, new types of ESI (social media, structured data, loose files, cloud context, mobile device messages, etc.) will cause headaches for a number of enterprises that have been overly email-centric. Already in 2011, organizations are finding that other sources of ESI like documents and structured data are rivaling email in importance for some ediscovery requests, and this trend shows no signs of abating, particularly for regulated industries. This heterogeneous mix of ESI will certainly result in challenges for many companies, with some unlucky ones getting sanctioned because they ignored these emerging data types.

9. Cost-shifting will become more prevalent, impacting the “American Rule.” For ages, the American Rule held that producing parties had to pay for their production costs, with a few narrow exceptions. Next year we’ll see even more courts award winning parties their e-discovery costs under 28 U.S.C. §1920(4) and Rule 54(d)(1) of the FRCP. Courts will continue to wrestle with how the services of an e-discovery vendor are “the 21st Century equivalent of making copies."

10. Risk assessment becomes a critical component of e-discovery. Managing risk is a foundational underpinning for litigators generally, but its role in e-discovery has been a bit obscure. Now, with the tremendous statistical insights that are made possible by enabling technologies, it will become increasingly important for counsel to manage risk by deciding what types of error rates are possible. This risk analysis is particularly critical for conducting any variety of technology assisted review process since precision, recall and f-measure statistics all require a delicate balance of risk and reward.

The future will see legal professionals continue to struggle with escalating data volumes, and perhaps more importantly, with new types of media, content delivery mechanisms and storage paradigms. Although these challenges are significant, with the right level of preparation, litigators and litigants alike will be able to successfully navigate the rapidly evolving legal technology landscape.